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Watch Japan-Record Pension Fund
Loss
Will it portend massive turmoil
for the US?
Most everyone knows, or they should by now,
everything comes in cycles, especially economics. Many factors affect these cycles. We used to say we have a free market but in
reality, we do not. Our “Fed” affects
our cycle by raising and lowering interest rates, artificially controlling the
money flow.
However,
we all know we can’t continue to spend money we don’t have. If any of the “New” Democrats get elected in
2020, they plan on spending a lot more money we don’t have which will mean much
higher taxes, lower employment and disaster…but wait.
We
may not have to wait for another Socialist-Democrat to break the bank. [Rumor
has it Karl Marx is being resurrected to run]
Financial breakdowns taking place in Japan could easily mean a breakdown
in Europe and eventually in the United States.
Just a few months ago, corporate
debt made up 45.5% of GDP... an all-time high at the time. It's currently at a
new all-time high of 46%. Personal debt
is at an all time high and Wall Street is holding its breath at the potential
losses from student loan defaults and all time high bad auto loans…
If we have learned anything from
history, this certainly doesn't look good. It's easy to make the case that a
recession is coming sooner rather than later.
Earnings are growing, and
businesses aren't borrowing as much. Still, with a debt-to-EBITDA ratio around
3.4 at the end of the second quarter, corporations are more leveraged than they
were during the financial crisis, second only to when the ratio spiked to 4
during the tech boom of the early 2000s.
It's important to note that many companies
haven't needed to issue new debt because of the savings they received from the
recent tax code change.
The China Shanghai Composite
Index began crashing one year ago. It
plunged to new 5-year lows last September.
Chinese manufacturers are
getting hit with labor shortages, surging wages, even worker rebellions…workers
don’t like making $1,000 I-Phones while getting paid peanuts-the Left in
America won’t talk about it so long as they’re campaign chests are being fueled
by Apple, Microsoft and other Silicon firms…
(Bloomberg) -- The world’s biggest pension fund
posted a record loss after a global equity rout last quarter pummeled an asset
class that made up about half of its investments.
Japan’s Government Investment Pension Fund lost
9.1 percent, or 14.8 trillion yen ($136 billion), in the three months ended
Dec. 31, it said in Tokyo on Friday. The decline in value was the steepest
based on comparable data back to April 2008. Domestic stocks were the fund’s
worst performing investment, followed by foreign equities.
The EU and Japan
Working Hard to Keep Trade Alive
The European Union and Japan on
Friday ushered in a landmark trade deal they say will boost business between
the two economic powers and sends the message that international pacts still
have a purpose in an age of increasing protectionism.
The agreement that comes into
effect will scrap nearly all tariffs on products both sides trade in. It will
have a big impact on Japanese exports of cars to Europe and EU exports of
agricultural products like cheese to Japan.
EU
foreign policy chief Federica Mogherini said Friday that both sides have
“something to celebrate. Today, we have the entry into force of the largest
ever free trade area.”
Ever
since the European Union was formed in 1979, the entire continent has been
drowning in a sea of debt [its socialist policies of unlimited health care,
free college, welfare, etc. especially to millions of refugees that swarmed the
continent]…of the 28 nations in the EU, 19 are mired in deep debt despite
repeated bailout attempts. The people of
Spain, for instance, would have to pony up ALL of their annual income in taxes
just for the government to break even!
According to the New York
Times, “the EU could dissipate faster than even its detractors could
have dreamed.” Is it any wonder the
Brits voted to get out of it?
The
euro has lost value [each time I’ve gone there I get more bang for my US
dollar]…at its peak in 2007 it was worth $1.59-in Dec. 2018 it dropped in value
to $1.13! I believe the EU will break
apart in 2019 and the first financial wave will hit Japan.
After
the United States and China, Europe [see above] is Japan’s biggest trading
partner. When that nation sends cars,
cameras and other goods to Europe, it expects to get paid. If they don’t, or if they get paid in
worthless euros, the fault lines in Japan’s economy will widen [Think about why
the Fed prints the dollar in overtime and pays its national debt in the same
fashion…each year our dollar is worth less and less, citizens have much less
buying power…the Fed steals from American taxpayers in this fashion].
Like
America, Japan economy is built on a house of cards which could fall:
The
national debt in Japan is even WORSE than any country in Europe, including Greece or Spain-it has the
biggest deficit in the world: more than
one quadrillion yen.
That’s
more than two and half times their entire economy. They continue to add to their debt at about
96 trillion a year but because they still have a strong manufacturing base
[something Trump has been trying to restore in America] and healthy trade
balance and as long as Europeans continue to purchase Hondas, the Japanese are
able to keep their Ponzi scheme afloat.
But
Japan has a second problem that is faces and its populace is not dumb [unlike
many Americans]…they know their debt is not sustainable. They know their pension plans and social
security system is at risk [we’ve posted many warnings here about at-risk
government pensions for nearly EVERY state] so many citizens have been hoarding
money at alarming rates, decreasing the amount of cash in circulation in the
economy.
Citizens
in Japan are savers, unlike Americans, and were aghast at those who were
struggling after missing one check during the government shutdown!
However,
the Japanese have suffered through four recessions in a row since 2008 and as a
nation this makes them less likely to get out of debt as they print money in
hopes of stimulating their economy just as the Fed did here.
When
the euro falls, it will take the yen with it and when that happens…there is
only one country that is in worse shape than Japan [and the majority of its
citizens are in worse shape as they are not prepared for any kind of
emergency]…THE UNITED STATES!
We
have the most debt at $21 trillion but if you include what the government owes
its veterans, Medicare/Medicaid recipients [or what the ‘New’ Democrats are
promising] and our debt comes closer to $127 trillion!
The
Fed and the government have no more ‘rabbits’ left to pull out of their hat for
rescues…they’ve lowered interest rates, they’ve pumped cash into the banking
system in exchange for bonds and securities [fewer nations are going to be
interested in buying them if Europe and Japan are in the toilet]. Global bond markets and investors will start
to dump US Treasury bills no matter how high the interest rates go.
Pensions
and annuities that millions depend on will vanish overnight. Without reserves, the government will have
little choice except to lay off its massive 2.7 million workforce…so will state
and local governments. No more food
stamps or welfare handouts. There will
be rioting as generations of families accustoming to living on ‘dole’ will
revolt.
The
government will use force to secure public order. It will steal private pensions, private food
hoards and more and redistribute supplies to the masses as most Americans have
forgotten how be self reliant, how to even plant a simple garden…gangs, who
already have guns, will roam freely, robbing citizens who have been stripped of
their gun rights by politicians and anti-gun activists.
None
of this will happen overnight.
What to Look For
My
grandfather left his home in Poland several years before Hitler achieved total
power and came to America. Once he saw
that Hitler was restricting gun ownership in Germany, restricting how much
money citizens could carry or take with them outside of the country when
traveling, when documents were needed to travel within their own country, when
it became ‘politically incorrect’ to speak one’s mind on many subjects…he got
out of Dodge!
My
deceased mother-in-law who lived in Germany during the war had said the same
thing [before she passed] about the growing restrictions here, the complete
lack of privacy and the need for a Social Security number to do everything, passport requirements just to visit Canada and
more…she worried about what was happening in America.
Some
financial gurus are forecasting this will be the last and fastest run-up in
stocks we’ll see in our lifetime and the Dow will likely hit 45,000 by 2020
even with Trump’s trade war with China [which should be a clear message to US
manufacturers: make goods in this
country…my political science professor and economics professor both agreed on a
simple maxim: Once a nation stops producing goods, that is the beginning of its
decline]!
Personally,
when I figured out the economy was going to tank in 2008-09 I warned all of my
readers and friends to get out of the stock market, get out debt, and to buy
small farms and to load up on silver and gold.
Those who heeded my advice were happy.
Several of us unloaded our portfolios and high-end mortgages and placed
our cash into small farms…we bought one outright-no mortgage and its value
continues to increase!
If
you do keep money in the stock market, and keep in mind I’m not a stockbroker
or financial advisor so always take my advice with a grain of salt…but here’s
what I tell my own family.
Stick
with basic, proven winners that include:
firms such as Hershey Chocolate, Wal-Mart, Dollar General, Green-Dot
Pre-paid Mastercard, precious metals, and defense stocks which are geared to
hypersonic research and computer/espionage technology.
Yours for a more secure future,
Bruce ‘the Poor Man!’
Final Notes…
Contributors and subscribers enable the Poor Man Survivor to post 150+ free essays annually. It is for this reason they are Heroes and Heroines of New Media. Without your financial support, the free content would disappear for the simple reason that I cannot keep body and soul together on my meager book sales & ecommerce alone.
Whether you’re an experienced home defense guru or a
complete amateur, the best way to prepare against a burglary or home invasion
is to prevent it from happening in the first place. But no matter how watchful
you are, sometimes you have to sleep, and some thieves know how to get around
the standard home security measures.
In case that happens, there are many unusual methods to
protect your family and valuables--methods that don't involve moving out of
your 3-bedroom house and into a fortified castle.
Here are 7 unusual home security tips you probably
didn’t know...
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Free: Economics in One Lesson -
Something the ‘new’ Democrats should read!
Digitized
Silver Coins?
Is expected to become viable soon
via the LODE token: “The emergence of distributed ledger technology inspires us to imagine
a new paradigm, one in which silver is restored to the economic system and used
as a utility to settle trade and commerce or for speculation. LODE is
constructing two cryptographic assets, each representing a unique relationship
to silver bullion. These assets will be
authentic, and transparent…”
Bullion-backed cryptocurrencies
would solve a number of problems which have discouraged me from personally
getting involved previously. I’ve signed
up to learn more as information becomes available and will pass along what I
learn.
Credit
Card Issuers are Cutting Credit
Some credit card firms are such as Discover Card say they are
reducing credit lines and in some cases closing inactive cards due to
uncertainty about the how long the US economy will stay strong before a
downturn makes it harder for card users to pay their bills.
People need to become more
self-reliant, not more dependent on government.
How to Survive the War on the Middle Class
Download here:
http://1drv.ms/1d9kfiU
How to Set Up Guaranteed Lifetime Income: One of
Americans' biggest worries about retirement is running out of money. These
concerns are not without merit. Americans have to save and plan for their own
retirement, and many people aren't saving nearly enough. U.S. News &
World Report
What We Can All Learn from the Government
Shutdown-How Little Americans Save
Sobering
State of Americans Personal Finance-PDF
Finally, grab
an emergency power cell!
Having
the Patriot Power Cell on-hand for emergencies keeps your essential electronics
up and running in case you need to call for help.
“The Cell is a workhorse of power — it’ll charge your phone
soup to nuts 3 to 8 times… I think of the Patriot Power Cell as “everyday
prepared.” Awesome for travel or avoiding inconveniences while saving your
bacon in an outage. It’s a MUST HAVE for your survival lineup."
10,000 mAh Battery/Water Resistant/2 LED Flashlight/1.5 Watt
Solar Panel/6-Hour Charge Time
Additional
Resources
How to Survive the War on the Middle
Class
14 of the best reports I’ve assembled on protecting your
freedom-Download link.
Social
Chaos Survival Guide: Savvy Precautions To Make You Self-Reliant
The 75 most populous cities’ total unfunded debt is approximately
$330 billion. Most of this debt comes from unfunded retiree benefit promises,
such as retiree healthcare debt and pensions. Unfortunately, one of the ways
the cities help make their budgets look balanced is by shortchanging public
pension funds.
Gold’s move come as the Federal Reserve is expected to strike a
dovish tone in its monetary policy statement and in central bank chair Jerome
Powell’s ensuing press conference. Central bank officials, including Powell,
have been hesitant to signal further tightening in monetary policy following
its December hike. In two events at the start of the year Powell said that
because of low inflation pressures, the Federal Reserve can be “patient” on
interest rate hikes. According to media reports, the central bank could also
signal a slowdown in its balance-sheet reduction program, which Powell has
previously described as on auto-pilot.
When asked what his current top commodity pick is, Global Head of
Commodities Research in the Global Investment Research Division at Goldman
Sachs Jeffrey Currie doesn't hesitate: "Long gold."
Many workers assume that Social Security will suffice in
retirement because their living expenses will go down once they stop working.
The reality, however, is that things like housing and transportation tend to
only drop modestly, if at all, during retirement. The reason? While many
seniors enter retirement with their mortgages already paid off, as homes age,
they tend to require more repairs and maintenance, the cost of which can be
enough to offset an absent mortgage payment. The same holds true for owning a
car -- though retirees don't have commuting costs to contend with, they still
have to worry about insurance and auto maintenance, which can be far more
expensive than filling up a vehicle's tank twice a week.
A
Smoking Frog Feature, Shallow Planet Production
4 comments:
Meaty material-gives me a lot to think about.
I do believe America and the world is headed for some seriously challenging times and your article seems to indicate a means of warning readers who to read the signs and how to prepare better-thanks.
In the Land of the Free, the average checking account now pays just 0.06% interest, while the rate of inflation is hovering around 2%.
This means that anyone who tries to be responsible and save money for the future is WORSE OFF after adjusting for inflation.
Bear in mind that an economic crisis is like any other crisis: an opportunity for politicians to capitalize on people’s fear to pass dangerously ambitious legislation that wouldn’t stand a chance under normal circumstances.
Think back to 9/11. People were so panicked and terrified that they didn’t notice or care that the government passed Orwellian legislation like the USA PATRIOT Act.
The next recession will likely help sweep the socialists into power in the US
You sure won't see this on CNN! Thanks for this post.
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